Fast Fashion Brand Is About To Disappear?

In recent years, the profits of many fast fashion brands have been falling continuously. According to the earnings report recently released by UNIQLO, the decline has reached 50%. It is not only UNIQLO, H&M group, but also

Group profits have fallen sharply.

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UNIQLO's pre tax profits plummeted nearly 50%

But it is still hot in Zhengzhou

UNIQLO, the once fashionable brand of fast fashion giant, has been declining in recent years.

In August 18th, UNIQLO parent fast Marketing Co., Ltd. released data showing that from November last year to August 2nd this year, UNIQLO's operating income earned $1 billion 270 million, down 23% from the same period last year.

The company's pre tax profits plummeted by 46.4% to 617 million dollars.

It has been reported that UNIQLO has been in a state of declining performance for nearly three years.

In February 29th, UNIQLO's 2015 half year financial year results showed that group net profit fell by 55.1%, the worst in 5 years.

It's not just UNIQLO.

In the first half of fiscal year 2016, the H&M group's pre tax profits plummeted by 22%. As of April 30th, GAP group's net sales fell by 6% to $3 billion 440 million, while it announced that it would close 75 other Old Navy and Banana Republic stores outside North America.

Compared with the profit figures which fell sharply on the earnings report,

Brand in Zhengzhou market hot shop, not busy.

From the earliest China World Trade Center 360, the new world department store to Zhongyuan Wanda, 27 Wanda, and the newly opened commercial complexes such as the Mixc and David town in the past two years, fast fashion brands have been placed in a prominent position.

Why? Because these brands can drain most.

27 business circle, a responsible person in the shopping mall, said that the fast fashion brand's clothing renewal rate is very fast, the new product can be updated two times a week, and 20 minutes can design a clothing.

"High speed, low volume, multi style, and low price are very attractive to young people. Shopping mall will be more inclined to introduce fast fashion brands under the premise of location and business area."

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Price rises and blacklist

In view of these fast fashion brands' different performance decline problems, the Henan Commercial Daily reporter consulted many Zhengzhou apparel industry practitioners, "Macroeconomic downturn" has become the first reason we mentioned.

Ask again more carefully, price rise, quality black list has become the most talked about.

"The rest is not easy to say, but the quality of fast fashion brands is often a problem."

Mainly for high-end customized boss Zhang said.

Searching for the two key words of "fast fashion brand + quality" on the Internet will immediately find many related news. The names of many fast fashion brands have appeared on the unqualified list announced by government supervision departments such as quality inspection, industry and commerce.

For example, in November 2015, the 60 batch of casual clothing products sampled by Shanghai Quality Supervision Bureau, GAP jeans, H&M casual wear and other 8 batches of products were unqualified, which involved many items such as perspiration fastness, water fastness and pH value.

In addition, price rise has also become the reason why consumers are alienated from fast fashion brands.

"Those who buy fast fashion brands are all price sensitive people. 399 or 499 yuan is acceptable, and 599 or 699 yuan will be hesitant."

The rising prices of products are not to be ignored by the fast fashion brands.

H&M, UNIQLO and many other brands have acknowledged the fact that the price increases. They attribute one of the reasons to the rise in human cost and operating costs.

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Continuous terminal network expansion

Or the main reason for the decline in profits.

The continued expansion of terminal outlets may be the biggest reason for the sharp fall in profits of fast fashion brands.

Fast fashion brands first entered China, which can be traced back to 2006. 2008~2012 is the fast fashion brand occupying the market for several years.

From 2012 to June 2013, in just a year and a half,

ZARA, H&M and C&A add a total of 207 stores at whirlwind speed.

In addition, the flagship store of fast fashion brand is getting bigger and bigger. UNIQLO's flagship store in Huaihailu Road, Shanghai, has an area of more than 8000 square meters from one to five stores. It is nicknamed "the flagship store of UNIQLO".

According to recent data, the number of UNIQLO terminals in Japan has increased by 2 this year to 846, while the number of UNIQLO stores outside Japan has increased by 161 to 928.

According to Sun Xun, a researcher at Utah international brand consulting (Beijing) Co., Ltd., there is a great risk for the continued expansion of UNIQLO to the global apparel industry. It also puts forward higher requirements for subsequent terminal management and brand differentiation.